Americans are perhaps the hardest working people on earth. We work so hard many of us pay no attention to “little things” happening in our own town, or in our own country, let alone half a world away. This time we better pay attention. This time “the little stuff” will become big stuff very quickly, and it is very bad.

Demonstrators protest on May Day in Madrid against Spain's economic policies.
(Getty Images)

Spain is about to become a gigantic problem for the entire world. Unlike Greece, Spain is too big to fail, but also too big to bailout. The economic news out of Spain is very, very, very bad news for all of us. Stress the “very.”

Mark this down — soon you will tune into the news and hear about “All Spain, all the time.” By this summer (and maybe sooner) Spain will be on everyone’s lips. You will wish you never heard of Spain. Spain could take us all down.

The reason Spain is so important is because size matters. Greece is a tiny country, yet its default threatened to destabilize and destroy the entire EU economy. To prevent that default the geniuses who run the EU “saved” Greece by loaning her another $170 billion to paper over her existing $100 billion in debt. They papered over the truth — Greece has defaulted on its debts.

But Greece is a tiny country. Spain is a big country. The 12th biggest economy in the world. There isn’t enough money in all the EU to save Spain. The real question is . . . is there enough money in all the world to save Spain? Will U.S. taxpayers agree to mortgage our children’s and grandchildren’s future (already buried in our own debt) to try to save Spain?

And even if America agreed to come to the rescue, where do we get the money? Have you seen the news lately? Our GDP is collapsing. Our unemployment rate is getting worse — again. Experts say it's clear we are going into a double-dip recession. To this economist it's clear we never left the first recession.

But our problems are small compared to Spain. Spain is in catastrophic shape. They are hanging by a thread off a cliff. And the thread is fraying. Spain's unemployment is fast approaching 25 percent. That’s reported unemployment.

If we used real numbers, not manipulated fake numbers provided by government (just like Obama uses in the U.S.), it might well be closer to 40 percent. Even worse, unemployment among young adults (25 and under) is 51 percent. And, this is all before their real estate falls off a cliff. Spanish real estate hasn’t even fallen as far as U.S. real estate — yet. Are you getting the picture?

Disaster looms.

But we haven’t even gotten to the real problem yet. Debt is the big issue. Not just government debt, but private debt, corporate debt and bank debt. While government debt is reported as 60 percent of GDP, when you count "off the books" obligations the real number may be well over 100 percent. Many thanks to my favorite economist, John Mauldin, for pointing out the raw truth.

As bad as government debt appears to be, private debt is the earthquake that should frighten every reader. Spanish private debt is 220 percent of GDP — meaning for every dollar produced in the entire Spanish economy, there is $2.20 in private debt. This is unfathomable.

Two weeks ago the global investment community finally figured out what I've been saying for months. Last month’s banking numbers are the proverbial canary in the coal mine proving Spain’s banks are in disastrous shape.

Their borrowing from the EU Central Bank DOUBLED in March. What does this mean? Spain’s banks are crippled. Walking corpses. They are insolvent and surviving only on emergency funds from the EU welfare fund. And since we’ve already established this is no small country like Greece, who has the money to bail out Spain and her big banks? The answer is NO ONE.

The EU Central Bank will try. They will undoubtedly convince the USA to join in the rescue. Hundreds of billions of dollars from U.S. taxpayers will be thrown down the drain — lost forever. This will plunge the U.S. economy into further decline. It is a vicious cycle with no end.

There is one lesson in this mess. Spain is a financial train wreck because of the exact same agenda that Barack Obama is trying to stuff down America’s throat. Spain is facing economic Armageddon because of big government, big spending, big taxes, big entitlements, big unions, big pensions, free healthcare, billions wasted on green energy, and, don’t forget, billions more on high speed rail. Size matters. And bigger isn't always better.

The golden lining in this entire mess is that we now have a model to save America. It’s simple. Cut spending dramatically. Cut government. Cut government employees. Cut pensions. And NEVER ever allow government to invest in the biggest scam of all-time: green energy. Spain's entire economy was wrecked by this progressive obsession with green energy and climate change. Every dollar spent on green energy kills three jobs in the private sector. That's why Spain is broke, insolvent, and jobless.

If you want to follow Spain into hell and Great Depression there is a simple answer — re-elect Barack Obama.

Wayne Allyn Root is a former Libertarian vice presidential nominee. He now serves as Chairman of the Libertarian National Campaign Committee. Read more reports from Wayne Allyn Root — Click Here Now.